Buyer decision processes are the decision making processes undertaken by consumers in regard to a potential market transaction before, during, and after the purchase of a product or service. More generally, decision making is the cognitive process of selecting a course of action from among multiple alternatives. Common examples include shopping and deciding what to eat.
In general there are three ways of analyzing consumer purchasing decisions: (1) Economic models—These models are largely quantitative and are based on the assumptions of rationality and near perfect knowledge. The consumer is seen to maximize their utility; (2) Psychological models—These models concentrate on psychological and cognitive processes such as motivation and need recognition. They are qualitative rather than quantitative and build on sociological factors like cultural influences and family influences; and (3) Consumer behavior models—These are practical models used by marketers. They typically blend both economic and psychological models.
One type of consumer behavior model is known as a “consumer decision tree” (“CDT”). A CDT is a graphical representation of a decision hierarchy of customers in a product attribute space for the purchase of an item in a given category. It models how customers consider different alternatives (based on attributes) within a category before narrowing down to the item of their choice, and helps to understand the purchasing decision of the customer. It is also commonly known as a “product segmentation and category structure”. CDTs are conventionally generated by brand manufacturers or third party market research firms based on surveys and other tools of market research. However, these methods lack accuracy and can lack authenticity since they may be based on biased data supplied by brand manufacturers.